Tesla shareholders have voted to approve a record-breaking compensation package for CEO Elon Musk worth up to US$1 trillion, approximately KES 162 trillion. The package, which received about 75 percent support, was announced during Tesla’s annual shareholders’ meeting in Austin, Texas.
The plan is one of the largest in corporate history. It gives Musk the potential to earn 12 tranches of stock options if Tesla meets a series of aggressive financial and operational targets over the next decade. The milestones include increasing Tesla’s market capitalization from about US$1.54 trillion to US$8.5 trillion, achieving 20 million vehicle deliveries per year, and reaching 10 million active Full Self-Driving (FSD) subscriptions. Musk could also receive tranches tied to the rollout of one million Optimus humanoid robots and one million robotaxis in commercial operation.
If all the targets are met, Musk’s ownership in Tesla would rise from about 13 percent to 25 percent, giving him significantly more control over the company. The board argues that the pay plan aligns Musk’s incentives with Tesla’s long-term growth goals and keeps him focused on the company’s ambitious mission.
The decision comes despite pushback from major proxy advisory firms including Glass Lewis and Institutional Shareholder Services (ISS), which had urged investors to reject the plan. Critics argue the package is excessive and could dilute shareholder value, while supporters see it as a necessary step to retain Musk and reward performance only if Tesla achieves remarkable success.
Tesla’s new compensation plan sets unprecedented targets. The first tranche of stock options will vest if the company’s market capitalization reaches US$2 trillion, equivalent to around KES 324 trillion. Each subsequent tranche is tied to increases in market cap and key earnings milestones, starting from US$50 billion in adjusted profit and extending up to US$400 billion. Tesla reported an adjusted EBITDA of US$4.2 billion in the third quarter of 2025, highlighting how far the company must go to unlock the full payout.
Musk told shareholders that the Optimus robots will “eliminate poverty,” “deliver advanced medical care,” and could even be used to reduce crime. He described them as an innovation “bigger than cell phones, bigger than anything,” though he did not specify when the robots might reach the market.
The pay plan also includes provisions known as “covered events” that allow Musk to earn shares without meeting all the operational goals. These events include wars, pandemics, natural disasters, or changes in laws that could affect Tesla’s ability to manufacture or sell its products.
The new package comes after a Delaware court ruled last year that Musk’s earlier 2018 compensation plan was improperly approved and must be rescinded. Musk has appealed that ruling, and the case is now before the Delaware Supreme Court.
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Beyond Tesla, Musk leads several other ventures including SpaceX, Starlink, Neuralink, The Boring Company, and xAI, which recently merged with X (formerly Twitter). Despite concerns about his divided attention and political involvement, the new compensation plan imposes no restrictions on his external activities or the time he must dedicate to Tesla.
For global investors, this approval underscores the growing scale of executive compensation and the bold ambitions of technology-driven companies. In Kenya, where Tesla’s valuation and innovations are closely followed, the figure of KES 162 trillion highlights both the extraordinary scale of the deal and the growing convergence between technology, energy, and artificial intelligence in shaping the future of global industries.
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